There are no commercially viable Small-Scale liquefied natural gas (LNG) production facilities anywhere in the world. “Small-Scale” means less than 10,000 liters/day. Thus, any existing liquefied natural gas-fueled fleet must depend on deliveries by tanker truck from larger-scale LNG plants or from LNG import terminals. The use of tanker trucks or terminals increases the cost of the LNG to the end user, because the delivered price must include the substantial cost of transporting the LNG from the production or import location to the customer. Those transportation costs tend to outweigh the lower production costs of large-scale LNG manufacture, where there is a large distance between the LNG source and the customer.
The LNG customer must also maintain a large storage tank so that deliveries can be spread out in time. Such tanks produce “boil off” which is generally vented to the atmosphere, causing methane emissions and loss of product, further increasing the net cost of the LNG, to both the end user and (by way of the emissions) to society at large. Heat gain to the storage tank, in the absence of on-site liquefaction, results in LNG that is not the ideal density for the vehicle's fuel tank. Re-liquefaction to avoid boil-off or to increase the product's density is not an option without an on-site LNG plant.
Other drawbacks to tanker-delivered LNG include the lack of competition in the industry, making the fleet owner excessively dependent on a single supplier. The quality of the delivered product may also vary, to the detriment of the fleet that uses the fuel.
The alternative that is commonly used is on-site Compressed Natural Gas (CNG) production, using the local natural gas pipeline as the feed source. However, such CNG systems have severe limitations, including the following: CNG, because it is not very dense, cannot be stored in large quantities, so it must be made at a high capacity during the peak vehicle fueling demand period. Similarly, the on-vehicle storage of CNG is limited by the need for heavy, high-pressure CNG tanks that store relatively little product, compared to the much denser LNG, and thus limit the travel range of the CNG vehicle.
Therefore, a system for the small-scale production of LNG from low-pressure pipelines and stranded wells is needed to overcome the above listed and other disadvantages of existing methods of converting low-pressure natural gas to a dense form that is easily storable and transportable.